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Taxable Person under GST

Updated on:  

08 min read

A ‘taxable person’ under GST, is a person who carries on any business at any place in India and who is registered or required to be registered under the GST Act. Any person who engages in economic activity including trade and commerce is treated as a taxable person.

‘Person’ here includes individuals, HUF, company, firm, LLP, an AOP/ BOI, any corporation or Government company, body corporate incorporated under laws of foreign country, co-operative society, local authority, government, trust, artificial juridical person.

Latest Updates on GST Registration

28th May 2021
Due date to file application for revocation of cancellation of registration falling between 15th April 2021 up to 29th June 2021 is 30th June 2021.

1st May 2021
The time limit to take actions, reply or pass orders as given under Rule 9 of the CGST Rules, 2017 that falls between 1st May 2021 and 31st May 2021 has been extended up to 15th June 2021.

5th March 2021
The Search ARN Functionality for Registration, post-TRN Login has been enhanced for the taxpayers.

31st January 2021
1. Persons applying for Registration in Form GST REG-01 as SEZ unit and SEZ developer would now be required to provide the validity period, as per Letter of Approval (LOA)/Letter of Permission (LOP).
2. A functionality has been provided to registrants to upload the copy of Notification issued by MEA /State while applying for Registration on GST Portal in Form GST REG-13.
3. Aadhaar Authentication for one Promoter and Primary authorized signatory has been implemented on the portal for existing taxpayers.

31st December 2020
1. For Taxpayers applying for new registration and opting for Aadhaar Authentication, the authentication would now be required to be done only for one Primary Authorized Signatory and one Promoter/Partner, instead of all.
2. A person registered as a GST Practitioner can now file an application for cancellation of their Registration, in Form GST PCT-06
3. While applying for a new Registration application, the taxpayers will now be shown some additional details related to the same PAN, in a table.
4. Immediately after initiation of GSTIN cancellation, the status of GSTIN for which cancellation is initiated will be shown as “Suspended” on the GST Portal.
5. Taxpayers can select the jurisdiction of CBIC and states/UTs on the basis of PIN code

20th August 2020
An option is given for Aadhaar authentication while obtaining the GST registration. The rules are amended with effect from 21st August 2020 as follows:
1. In case the aadhaar authentication is opted for, it must be completed while submitting the application. The date of application is earlier of the date of aadhaar authentication or fifteen days from the submission of the application in Part B of Form GST REG-01.
2. For the rest of the applicants, physical verification of place of business will be carried out, including document verification, as the case may be, with permission.
3. Cases of deemed approval have also been listed.

Click here to know more about aadhaar authentication.

27th June 2020
The time limit for completion or compliance has been further extended to 31st August 2020, where the time limit falls between the period from 20th March 2020 to 30th August 2020. But it does not include cases where a person needs to obtain GST registration under section 25 (Normal registration) and 27 (Registration as a casual taxable person/ non-resident taxable person) of the CGST Act.

3rd April 2020
The time limit for completion or compliance has been extended to 30th June 2020, where the time limit falls between the period from 20th March 2020 to 29th June 2020. It does not include cases where a person needs to obtain GST registration under section 25 (Normal registration) and 27 (Registration as a casual taxable person/ non-resident taxable person) of the CGST Act.

Who is Liable to get Registered under GST? 

GST registration is mandatory for-

  • Any business involved in the supply of goods whose turnover in a financial year exceeds Rs.40 lakhs for Normal Category states (Rs.20 lakhs for Special Category states)*
  • Any business involved in the supply of services whose turnover in a financial year exceeds Rs.20 lakhs for Normal Category states (Rs.10 lakhs for Special Category states)
  • Every person who is registered under an earlier law (i.e., Excise, VAT, Service Tax etc.)  needs to register under GST, too.
  • When a business which is registered has been transferred to someone/demerged, the transferee shall take registration with effect from the date of transfer.
  • A person making inter-state supplies
  • Casual taxable person (see below)
  • Non-Resident taxable person (see below)
  • Agents of a supplier
  • Those paying tax under the reverse charge mechanism
  • Input service distributor (see below)
  • e-Commerce operator or aggregator*
  • Person who supplies via e-commerce aggregator
  • Person supplying online information and database access or retrieval (OIDAR) services from a place outside India to a person in India, other than a registered taxable person

Note: If your turnover is supply of only exempted  goods/services which are exempt under GST, this clause does not apply. 

*Some Normal Category states have chosen to continue with the existing limit of Rs.20 lakh, and some Special Category states have opted for an increased limit of Rs.40 lakh.

**e-commerce sellers/aggregators need not register if total sales is less than Rs. 20 lakh. Notification No. 65/2017 – Central Tax dated 15th November 2017

Who is a Casual Taxable Person under GST?

A person who occasionally supplies goods and/or services in a territory where GST is applicable but he does not have a fixed place of business. Such a person will be treated as a casual taxable person as per GST. 

Example: A person who has a place of business in Bangalore supplies taxable consulting services in Pune where he has no place of business would be treated as a casual taxable person in Pune.

Who is a Non-Resident Taxable person under GST?

When a non-resident occasionally supplies goods/services in a territory where GST applies, but he does not have a fixed place of business in India. As per GST, he will be treated as a non-resident taxable person. It is similar to above except the non-resident has no place of business in India.

Who is an Input Service Distributor?

Input Service Distributor’ means an office of the supplier of goods/services which receives tax invoices on receipt of input services and issues tax invoices for the purpose of distributing the credit of CGST/SGST/IGST paid on the said services to your branch with the same PAN. (It must be a supplier of taxable goods /services having the same PAN as that of the office referred to above). 

Thus, only credit on ‘input services’ can be distributed and not on input goods or capital goods. This will be a new concept for assessees who are currently not registered as input service distributors. However, this facility is optional in nature.

Who is a composition taxpayer?

A composition taxpayer refers to those registered under the composition scheme who need not collect GST from his customers at normal rates. Instead, he can pay tax at a nominal rate or lower rates to the government on the basis of turnover or receipts on a quarterly basis while filing CMP-08.

There are certain conditions defined for such taxpayers. At the inception of GST, only suppliers of goods could opt into the composition scheme governed by Section 10 of the CGST Act with annual turnover upto Rs.1.5 crore. From 1st April 2019, service providers are also given an option to join a similar scheme. The annual aggregate turnover limit must be up to Rs.50 lakh.

Who is a QRMP taxpayer?

A registered person who is required to furnish a return in GSTR-3B, and who has an aggregate turnover of up to Rs.5 crore rupees in the preceding financial year, is eligible for the QRMP Scheme. Under the scheme, one can file GSTR-1 and GSTR-3B once in a quarter whereas make tax payment every month in form PMT-06. Further, if B2B sales invoices need to be uploaded on the GST portal monthly, then Invoice Furnishing Facility (IFF) can be used.

GST Registration by Type of Taxable Person

  • Every person has to apply for registration in every State in which he is liable, within thirty days from the date on which he becomes liable to registration.
  • Casual / non-resident taxable persons should apply at least five days before their commencement of business.
  • Registration number in GST will be PAN based and hence, having PAN would be a prerequisite for obtaining registration.
  • The assessee must obtain separate registration for each State, as registration under GST will be State-wise,
  • The assessee has an option to obtain a separate registration for each of the ‘business verticals’ in the same State.

Special provisions of GST Registration for casual taxable person and non-resident taxable person 

A casual taxable person or a non-resident taxable person shall apply for registration at least five days prior to the commencement of business. Section 24 provides for special provisions relating to casual taxable persons and non-resident taxable persons under GST. 

Casual/non-resident taxable person may obtain a temporary registration for a period of 90 days (extendable for additional 90 days). A person who obtains registration u/s 24, will be required to make an advance deposit of GST (based on his estimated tax liability).

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